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Stock Analysis & ValuationArzneiwerk AG VIDA (TLIK.DE)

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0.61
Sector Valuation Confidence Level
Low
Valuation methodValue, Upside, %
Artificial intelligence (AI)1758.97288256
Intrinsic value (DCF)0.21-66
Graham-Dodd Methodn/a
Graham Formulan/a

Strategic Investment Analysis

Company Overview

TELES AG Informationstechnologien is a German telecommunications and pharmaceuticals company headquartered in Berlin. Founded in 1983, TELES operates in two primary business areas: telecommunications and pharmaceuticals. In telecommunications, the company provides digitization solutions for carriers, including Softclients, mobile apps, Softswitches, and cloud-based UC services tailored for small and medium-sized enterprises. Its product portfolio also includes interconnect solutions, network migration services, and consulting. Additionally, TELES operates a pharmacy data center and supplies pharmaceutical products. The company serves both domestic and international markets, positioning itself as a niche player in the communication equipment sector. With a market capitalization of approximately €3.74 million, TELES focuses on integrating fixed and mobile enterprise communication while maintaining a diversified revenue stream from its pharmaceutical operations. Despite its small size, TELES leverages its long-standing industry expertise to serve specialized segments within the broader technology and healthcare sectors.

Investment Summary

TELES AG Informationstechnologien presents a high-risk investment opportunity due to its small market capitalization (€3.74M) and recent financial struggles, including a net loss of €2.88M in FY 2023. The company operates in competitive industries—telecommunications and pharmaceuticals—where scale and innovation are critical. While its diversified business model (combining telecom solutions and pharmaceutical distribution) provides some resilience, its negative EPS (-€0.46) and modest operating cash flow (€193K) raise concerns about sustainability. The lack of dividends further limits income appeal. Investors should weigh its niche positioning in telecom digitization against its financial instability and the capital-intensive nature of its sectors. A speculative play, TELES may appeal only to those betting on a turnaround or acquisition potential.

Competitive Analysis

TELES AG Informationstechnologien competes in the fragmented telecommunications equipment and pharmaceutical distribution markets. In telecom, its niche focus on digitization solutions for carriers and SMEs differentiates it from larger players, but its small scale limits R&D and global reach. The company’s Softswitch and cloud UC offerings face stiff competition from established vendors like Cisco and Avaya, which dominate with broader portfolios and stronger brand recognition. TELES’s pharmaceutical segment, while providing diversification, lacks the scale of major distributors like McKesson or AmerisourceBergen. Its competitive edge lies in its integrated telecom-pharma model, which is rare but not easily scalable. Financially, TELES is disadvantaged by its negative net income and high debt-to-equity ratio, constraining its ability to invest in growth. Its beta of 1.03 suggests market-average volatility, but its micro-cap status amplifies liquidity risks. To thrive, TELES must either carve out a defensible niche in telecom digitization or seek strategic partnerships to bolster its pharmaceutical operations.

Major Competitors

  • Cisco Systems, Inc. (CSCO): Cisco dominates the global telecom equipment market with a comprehensive portfolio of networking hardware, software, and services. Its scale, R&D budget, and brand strength far surpass TELES’s capabilities. However, Cisco’s focus on large enterprises leaves room for TELES in niche SME solutions. Weaknesses include declining legacy hardware sales and exposure to macroeconomic downturns.
  • Avaya Holdings Corp. (AVYA): Avaya specializes in unified communications and contact center solutions, overlapping with TELES’s cloud UC services. While Avaya has stronger enterprise traction, its recent bankruptcy restructuring has eroded customer trust. TELES could capitalize on Avaya’s instability by targeting cost-sensitive SMEs, but lacks Avaya’s installed base and global support infrastructure.
  • McKesson Corporation (MCK): McKesson is a pharmaceutical distribution giant, dwarfing TELES’s pharmacy operations. Its economies of scale and logistics network are unmatched, but TELES’s localized German focus may offer agility in regional pharmaceutical supply. McKesson’s diversification into healthcare IT also pressures TELES’s dual-sector model.
  • AmerisourceBergen Corporation (ABC): Another top-tier pharmaceutical distributor, AmerisourceBergen’s global reach and partnerships with manufacturers overshadow TELES’s modest pharmacy data center. However, TELES’s integration of telecom and pharma services is unique, albeit unproven at scale. AmerisourceBergen’s reliance on bulk distribution limits its niche flexibility.
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